{"id":836946,"date":"2025-09-05T12:07:13","date_gmt":"2025-09-05T10:07:13","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=836946"},"modified":"2025-09-05T12:07:20","modified_gmt":"2025-09-05T10:07:20","slug":"critical-south-african-state-owned-company-hit-with-r1-9-billion-loss","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/business-opinion\/836946\/critical-south-african-state-owned-company-hit-with-r1-9-billion-loss\/","title":{"rendered":"Critical South African state-owned company hit with R1.9 billion loss"},"content":{"rendered":"\n

South Africa\u2019s logistics provider, Transnet, has declared a loss of R1.9 billion following years of mismanagement. <\/p>\n\n\n\n

Transnet was previously one of South Africa\u2019s best-performing companies and was the nation\u2019s largest taxpayer. <\/p>\n\n\n\n

However, amid rising state capture and poor governance practices, it fell into a state of disrepair. <\/p>\n\n\n\n

While the impact of load shedding was clear to many South Africans, the crisis at Transnet has been described as worse in some corners, as rail and port issues stop businesses from trading goods and raw materials. <\/p>\n\n\n\n

Operational failures at the group cost South Africa roughly R1 billion per day in lost economic output, translating to an estimated 4.9% of the nation\u2019s GDP in 2023. <\/p>\n\n\n\n

In its latest financial results for the year ended 31 March 2025, the group saw its revenue increase by 7.8% to R87.2 billion. <\/p>\n\n\n\n

Its loss for the year was still a large R1.9 billion. However, this was a 74% improvement from the R7.3 billion loss in the 2024 financial year. <\/p>\n\n\n\n

The SOE said that it experienced a major improvement in its operating environment, especially in the rail business, owing to the implementation of its recovery plan. <\/p>\n\n\n\n

Weighted average tariff increases drove the increase in revenue as well volume increases in the automotive and rail businesses, partially offset by lower pipeline and container volumes.<\/p>\n\n\n\n

The group said that the rise in revenue came despite various challenges impacting the port and rail business. <\/p>\n\n\n\n

This included derailments, rail network challenges, theft and vandalism, declining reliability of the legacy fleet, adverse weather conditions, tippler breakdowns and equipment reliability issues. <\/p>\n\n\n

\n
\"\"<\/a><\/figure><\/div>\n\n\n

Looks for partners\u00a0<\/h2>\n\n\n\n

As the group wraps up its tactical recovery plan, its focus will shift from operational recovery to transformation and long-term, sustainable growth. <\/p>\n\n\n\n

The group said it remains committed to improving the turnaround times, reducing congestion and enhancing the predictability of its services across the rail, port and pipeline businesses.<\/p>\n\n\n\n

It said investments in new equipment, digital systems and operational excellence are already yielding positive results. <\/p>\n\n\n\n

It noted that private sector participation will remain a cornerstone of its strategy, with several private sector operators now confirmed to operate on Transnet\u2019s rail infrastructure\/ <\/p>\n\n\n\n

The group said that its corporate plan for the coming years includes: <\/p>\n\n\n\n

    \n
  • Deepen private sector participation in rail and port operations;<\/li>\n\n\n\n
  • Strengthen financial resilience and governance;\u00a0<\/li>\n\n\n\n
  • Drive digital transformation and innovation; and\u00a0<\/li>\n\n\n\n
  • Embed a culture of performance, safety and service excellence.<\/li>\n<\/ul>\n\n\n\n

    Following the growing crisis at Transnet, the Presidency also created the  National Logistics Crisis Committee in June 2023. <\/p>\n\n\n\n

    This was crucial in advancing reforms within South Africa\u2019s freight logistics sector. <\/p>\n\n\n\n

    Transient said that it made significant progress in implementing key initiatives outlined in the Freight Logistics Roadmap (FLR), which outlines the strategic direction for the sector. Achievements include: <\/p>\n\n\n\n

      \n
    • Establishment of the Transnet Rail Infrastructure Manager (TRIM)<\/li>\n\n\n\n
    • Publication of the final network statement<\/li>\n\n\n\n
    • Launch of the slot application process<\/li>\n\n\n\n
    • Port infrastructure and equipment enhancements<\/li>\n\n\n\n
    • Private sector participation in container terminal development<\/li>\n<\/ul>\n\n\n\n

      Looking ahead, Transnet said that these initiatives are embedded within its growth strategy, which lays the foundation for expansionary growth. <\/p>\n\n\n\n

      \u201cIn the 2025\/26FY, our focus will be on measurable improvements in rail volumes, port throughput and financial sustainability, while embedding accountability and performance monitoring to ensure delivery,\u201d said the group. <\/p>\n","protected":false},"excerpt":{"rendered":"

      Transnet has reduced its losses, as the group looks to private partners to help it out of disaster. <\/p>\n","protected":false},"author":95,"featured_media":783321,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[1164,2138],"class_list":["post-836946","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business-opinion","tag-eskom","tag-transnet"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/836946","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/95"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=836946"}],"version-history":[{"count":3,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/836946\/revisions"}],"predecessor-version":[{"id":836952,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/836946\/revisions\/836952"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/783321"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=836946"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=836946"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=836946"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}